Bookmark and Share

19 Nearly Debt-Free Dividend Achievers To Consider When Interest Rates Rise

Recently I began looking for dividend paying companies that carried no debt (or very little) on their books.

Not every company that I found would fit into my portfolio but several have found a place on my watch list and could prove to be quality investments over a long time period.

A company may have no debt for many reasons, not all are a positive for an investor. From an investor's stand point right away we see the benefit of a company having no debt because if you choose to invest in that company you are not incurring any share of their debt.

By remaining skeptical and cautious we must ask ourselves how they came to have no debt. It could be that their products sell so well they generate enough revenue to cover all their expenses.

On the other end of the spectrum it could be that the company is doing so poorly that nobody is willing to lend them money.

In no way am I saying that debt is bad for a company, or even an individual. Debt can be a tax advantage for many corporations as the interest payments provide a great tax break.

Companies often also utilize debt to finance their operations rather than their equity. If companies continue to sell additional shares to finance their operations it can destroy shareholder value, especially when that money raised does not go toward improving revenue and growth.

On a broader view, companies with no debt and high amounts of cash are better positioned for higher interest rates. If interest payments go up, the company gets more money from its bank and don't need to pay higher loan rates.

Attached you will find the best dividend growth stocks that are nearly debt-free in relation to its equity. The ratio I've discovered was the debt-to-equity ratio. Each of the stocks I've researched has a very low ratio of less than 0.1.

At the end of this article, you can find the full list with more fundamentals of all 19 results. Below are the 5 best yielding stocks in detail.

Here are the results...

Cullen/Frost Bank -- Yield: 3.71%

Cullen/Frost Bank (NYSE:CFR) employs 4,154 people, generates revenue of $701.47 million and has a net income of $277.98 million. The current market capitalization stands at $3.56 billion.

Cullen/Frost Bank’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $379.23 million. The EBITDA margin is 37.66% (the operating margin is 33.37% and the net profit margin 27.60%).

Financials: The total debt represents 3.68% of Cullen/Frost Bank assets and the total debt in relation to the equity amounts to 36.48%. Due to the financial situation, a return on equity of 10.59% was realized by Cullen/Frost Bank.

Twelve trailing months earnings per share reached a value of $4.47. Last fiscal year, Cullen/Frost Bank paid $2.03 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 12.78, the P/S ratio is 3.54 and the P/B ratio is finally 1.33. The dividend yield amounts to 3.71%.

Stock Charts:

Long-Term Stock Price Chart of Cullen/Frost Bank (CFR)
Long-Term Stock Price Chart of Cullen/Frost Bank (CFR)
Long-Term Dividend Payment History of Cullen/Frost Bank (CFR)
Long-Term Dividend Payment History of Cullen/Frost Bank (CFR)
Long-Term Dividend Yield History of Cullen/Frost Bank (CFR)
Long-Term Dividend Yield History of Cullen/Frost Bank (CFR)


Erie Indemnity -- Yield: 3.11%

Erie Indemnity (NASDAQ:ERIE) employs 4,700 people, generates revenue of $6,128.00 million and has a net income of $573.00 million. The current market capitalization stands at $4.91 billion.

Erie Indemnity’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $857.00 million. The EBITDA margin is 13.98% (the operating margin is 13.54% and the net profit margin 9.35%).

Financials: The total debt represents 0.00% of Erie Indemnity assets and the total debt in relation to the equity amounts to 0.00%. Due to the financial situation, a return on equity of 23.38% was realized by Erie Indemnity.

Twelve trailing months earnings per share reached a value of $3.25. Last fiscal year, Erie Indemnity paid $2.59 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 28.91, the P/S ratio is 0.80 and the P/B ratio is finally 6.17. The dividend yield amounts to 3.11%.

Stock Charts:

Long-Term Stock Price Chart of Erie Indemnity (ERIE)
Long-Term Stock Price Chart of Erie Indemnity (ERIE)
Long-Term Dividend Payment History of Erie Indemnity (ERIE)
Long-Term Dividend Payment History of Erie Indemnity (ERIE)
Long-Term Dividend Yield History of Erie Indemnity (ERIE)
Long-Term Dividend Yield History of Erie Indemnity (ERIE)


BOK Financial -- Yield: 3.00%

BOK Financial (NASDAQ:BOKF) employs 4,743 people, generates revenue of $732.24 million and has a net income of $295.48 million. The current market capitalization stands at $3.89 billion.

BOK Financial’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $502.72 million. The EBITDA margin is 39.34% (the operating margin is 33.68% and the net profit margin 23.12%).

Financials: The total debt represents 5.58% of BOK Financial assets and the total debt in relation to the equity amounts to 49.15%. Due to the financial situation, a return on equity of 9.15% was realized by BOK Financial.

Twelve trailing months earnings per share reached a value of $4.25. Last fiscal year, BOK Financial paid $1.62 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 13.51, the P/S ratio is 3.04 and the P/B ratio is finally 1.20. The dividend yield amounts to 3.00%.

Stock Charts:

Long-Term Stock Price Chart of BOK Financial (BOKF)
Long-Term Stock Price Chart of BOK Financial (BOKF)
Long-Term Dividend Payment History of BOK Financial (BOKF)
Long-Term Dividend Payment History of BOK Financial (BOKF)
Long-Term Dividend Yield History of BOK Financial (BOKF)
Long-Term Dividend Yield History of BOK Financial (BOKF)


T. Rowe Price Group -- Yield: 2.95%

T. Rowe Price Group (NASDAQ:TROW) employs 5,908 people, generates revenue of $3,982.10 million and has a net income of $1,229.60 million. The current market capitalization stands at $17.70 billion.

T. Rowe Price Group’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $2,002.60 million. The EBITDA margin is 50.29% (the operating margin is 47.48% and the net profit margin 30.88%).

Financials: The total debt represents 0.00% of T. Rowe Price Group assets and the total debt in relation to the equity amounts to 0.00%. Due to the financial situation, a return on equity of 23.80% was realized by T. Rowe Price Group.

Twelve trailing months earnings per share reached a value of $4.51. Last fiscal year, T. Rowe Price Group paid $1.76 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 15.62, the P/S ratio is 4.44 and the P/B ratio is finally 3.41. The dividend yield amounts to 2.95%.

Stock Charts:

Long-Term Stock Price Chart of T. Rowe Price Group (TROW)
Long-Term Stock Price Chart of T. Rowe Price Group (TROW)
Long-Term Dividend Payment History of T. Rowe Price Group (TROW)
Long-Term Dividend Payment History of T. Rowe Price Group (TROW)
Long-Term Dividend Yield History of T. Rowe Price Group (TROW)
Long-Term Dividend Yield History of T. Rowe Price Group (TROW)


Linear Technology -- Yield: 2.86%

Linear Technology (NASDAQ:LLTC) employs 4,868 people, generates revenue of $1,475.14 million and has a net income of $520.96 million. The current market capitalization stands at $10.02 billion.

Linear Technology’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $736.80 million. The EBITDA margin is 49.95% (the operating margin is 46.28% and the net profit margin 35.32%).

Financials: The total debt represents 0.00% of Linear Technology assets and the total debt in relation to the equity amounts to 0.00%. Due to the financial situation, a return on equity of 35.81% was realized by Linear Technology.

Twelve trailing months earnings per share reached a value of $2.05. Last fiscal year, Linear Technology paid $1.14 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 20.41, the P/S ratio is 6.80 and the P/B ratio is finally 6.37. The dividend yield amounts to 2.86%.

Stock Charts:

Long-Term Stock Price Chart of Linear Technology (LLTC)
Long-Term Stock Price Chart of Linear Technology (LLTC)
Long-Term Dividend Payment History of Linear Technology (LLTC)
Long-Term Dividend Payment History of Linear Technology (LLTC)
Long-Term Dividend Yield History of Linear Technology (LLTC)
Long-Term Dividend Yield History of Linear Technology (LLTC)

19 Nearly Debt-Free Dividend Achievers (click to enlarge)

1 comment:

  1. Anonymous1/10/2016

    ADD BRIEF DESCRIPTIONS OF THESE COMPANIES.

    ReplyDelete

Do you have any questions or notes to this article?
Please let me know your thoughts and we will discuss it.